The first problem you'll run into, due to lack of haste, is getting your units to close with Baal so he does his melee attack instead of sword-throwing and/or summoning MORE demons. As you really don't want him throwing his sword or summoning more demons, you could try using teleport x2 in the first round to make nice big targets out of your paladins and knights in a row as soon as you can kill off at least one of the demon stacks. If you game also didn't generate Teleport, you could try the sacrificial lamb approach - use a fast flyer (e.g., royal griffins) plus a summoned unit (e.g., phantom or call of nature) as big targets, and recognize that your flier is going to get hammered on the second round. If your game didn't generate Teleport, Haste, or any summoning spells, make sure you're playing Armored Princess and not SimCity.
With intelligence 66, once you have things under control you'll probably want to retaliate against his summoning demons with a Geyser - it won't kill any of his stacks, but it achieves three things: it makes it a heck of a lot easier for you to kill them with your actual units, it decreases how much damage they can do to you, and it knocks the numbers of his archdemons down so you don't have to worry about the halving ability.
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